Interested to see what the commonalities or not would be.

Data centre owner Equinix latest target of Hindenburg

Bloomberg

Short seller Hindenburg Research targeted data centre owner Equinix, alleging that the company manipulates its accounting and is selling an “AI pipe dream”.

Hindenburg’s disclosure of a short position and its allegations raise questions about the future for Equinix, which has been benefiting from the expectation that artificial intelligence companies will need even more data centres to power the technology.

Equinix shares fell on Wednesday in New York and the company pulled a previously planned bond offering after the report hit.

A representative for Equinix said the firm is investigating the claims.

Hindenburg alleges that the nearly $US80 billion ($122.5 billion) real estate investment trust is manipulating its accounting for a key profitability metric — adjusted funds from operations — and overstated that figure by at least 22 per cent in 2023. The short seller also said Equinix trades at elevated levels even if financials are taken “at face value”.

Microsoft reported yesterday and highlighted in Azure the slowdown in cloud computing demand with the slowing economy - I'd assume this is temporary in nature and the strucutral trend is still up. What was interesting was the increase in electricity prices crimping margins being so massivley power hungry.

Might have some flow on effects to NXT.

I don't follow data centres closely as I was always worried about technologic absolesence (Moore's Law) making it a very capital intensive business with the long term economics unclear especially given the commodity nature of the industrie and the hyperscaler opposition. I am by no means an expert and this is probably a very uninformed viewe, especially with smart investors like Gurav often citing how excellent these businesses are including Macquarie Telecom and Infratil.

I had not thought of privacy also being an issue - but this article is interesting in discussing this. The quote of replacing every 3 - 5 years if true (and I'm not sure on cost) seems like a rather short payback and profit period. - Why Big Tech shreds millions of storage devices it could reuse | Financial Times (ft.com)

Key quotes below:

Data centres usually upgrade their servers every three to five years, meaning most of the 11mn that were produced globally in 2017 will be decommissioned this year. 

 Although most data centre companies discard their storage devices after a few years, they could last for years — or even decades — longer, according to several industry experts. 

 “Clients are so worried about disposal of data that they’re insisting on the hard drives being destroyed,” says Michael Winterson of global data centre provider Equinix.

 Some of the major cloud computing providers have been taking steps towards reuse. Google says 27 per cent of the components it used in server upgrades in 2021 were refurbished inventory and that it overwrites data on its hard drives for reuse where possible. Microsoft now operates several circular centres” for refurbishing old servers and says more than 80 per cent of its decommissioned assets will be repurposed by 2024. But for hard drives, specifically, shredding is still the norm.